One of the most important factors in determining a website’s placement in searches performed by Google is its PageRank. Although the pagerank is one of other hundreds of factors that Google uses for defining the order of its search results, it is one of the most important ones.

What is a Pagerank?
A pagerank is a numerical index that is used by the Google search engine in order to measure the importance of a certain webpage. Google measures this by checking the number and quality of the page’s incoming links. Every direction to a webpage serves as a “vote of confidence” for that page, and the higher the number and quality of inbound links, the higher its importance will probably be.

A number of things you should know about PageRank:

It is assigned per page and not per site.
It does not depend on a specific keyword, but rather defines the importance level of an entire webpage.
PageRank used to be very significant in determining Google’s search results, but its significance is gradually decreasing.
I will be referring to the Pagerank term in its abbreviated form - PR.

PageRank check
The simplest way to check a certain page’s pagerank is with the Google Toolbar. The toolbar is an Explorer add-on that displays the PR level for every page you visit:

For information regarding determining an exact PR, you should refer to the Exact PageRank Check.

Determining PageRank
The process of determining PR begins with collecting all incoming links to the webpage (from other website and the same website). After the links collection, each link’s quality is evaluated. The quality is measured by several factors:

PR of the linking webpage
The higher the linking page’s PR is, the higher its vote’s importance will be. A vote from a large, well established website does not count as a vote from a small website. For this reason it is sometimes better to have one link from a page with high PR than ten links from pages with low PR.
Number of links on linking page
A certain webpage’s voting power is divided among all of its outbound links. If a certain page contains only one link, then all of the voting power will go there. If a page contains a hundred links to different pages, the voting power will be divided between all of those pages.
Internal Vs. external links
this is a controversial point. Although officially there is no difference between a link that originates in a different site and a link from the same site, it seems to me that external links do have more significance.
The “voting” data is translated to a numeric score, which is the PR. By the way, this score is not the score you receive on Google’s toolbar.

After assigning the final score, Google divides the webpages into ten groups (PR1-PR10). The size of each group varies! The size decreases exponentially: there will more PR3 than PR4 webpages, and more PR4 than PR5 webpages. Progressing from PR to PR is harder for higher PRs.

Google calculates the PR of webpages in its cache on a regular basis. However, the update of the data that is displayed in the Google toolbar and site guide is performed once in every few months (usually once in every three to four months). By the way, the site guide data is updated separately from the toolbar update. The meaning of this fact is that the PR that you see on Google’s toolbar is actually no more than a snapshot at a certain moment in time!

Penalties for Spamming
Search engines constantly engage in locating websites that use invalid techniques in order to advance their placement on search engine results (spam). The main problem here is that the boundary between invalid techniques and legitimate webpage optimization is very thin, and it’s hard to know if you crossed it.